Bank liable for duplicate cheques

Brijesh Sharma, a medical doctor and his wife Sapna, hailing from Nagpur, had an account with Canara Bank’s Ramdaspeth Branch since 2005. The account was continued even after they migrated to the United Kingdom in 2010. The bank issued a cheque book to them in 2011, which contained 20 leaves. Some of these cheques were used.

On March 15, 2012, Sapna received a phone call from the bank informing her that there was some discrepancy in one of the cheques and inquired whether to honour it or not. Her husband called up the Chief Manager and told him that no cheque had been issued. The manager informed that four cheques had already been cleared from the account. Brijesh flew down and visited the branch. 

His account statement revealed that a total of Rs 18.45 lakh had been siphoned off through four cheques. On comparing the cheque numbers, Brijesh observed that they were identical to the unused cheques in his custody. He pointed out that not only was his signature forged, even the cheque leaves were forged. He argued this could be possible only with the con­n­ivance of bank officials   who were aware of the series of cheques issued to him and the amount available in his account.

Canara Bank claimed it had honoured the cheques without physical verification, but by viewing an electronic image of the cheques, and payment was made since the signature resembled that of Sharma. The latter lodged a police complaint and also filed a case before the Maharashtra State Consumer Commission. The bank questioned the maintainability of the complaint as a police investigation was underway. It stated that it was impossible that it had printed duplicate cheques with the same numbers, and accused Brijesh of having forged them to make a false claim since the branch name was wrongly printed as ‘Randaspeth’ instead of ‘Ramdaspeth’. The bank also argued that a complicated matter concerning forgery could not be adjudicated by a consumer forum.

The State Commission overruled the objections and allowed the complaint. It ordered Canara Bank to refund Rs 18.45 lakh along with 6 per cent interest within 30 days, or with 9 per cent interest if payment was delayed. Further, Rs 25,000 was awarded as compensation and Rs 10,000 as litigation cost.

Canara Bank appealed against the order. The National Commission observed that the bank was unable to produce the cheques on which it had made a payment, and the excuse given was that these had been destroyed by white ants. It refused to countenance the printing error in the branch name as another cheque from the same series with the same error, issued for payment of society maintenance charges, had been honoured. So the Commission concluded that it was incorrect to accuse Sharma of having forged the cheques. Besides, the bank also made a payment without verifying the signature. It  held this to be a negligent act amounting to deficiency in service.

Accordingly, by its order of September 20, 2019, delivered by M Shreesha for the bench headed by Justice R K Agrawal, the National Commission dismissed the appeal and confirmed the order holding Canara Bank liable.

The writer is a consumer activist